Virginia Police Raid 11 Sweepstakes Cafés

VIRGINIA BEACH, VA -- Following a six-month undercover investigation, masked police here shut down 11 Internet cafés in raids on Wednesday, Sept. 22. Authorities seized up to 500 computers that officials said were used for illegal gambling.

No arrests were made, but the Virginia Beach Commonwealth's Attorney, Harvey Bryant, said operators might be criminally charged with felony gambling counts after a review of the evidence.

The deployment of Internet sweepstakes videogames awarding cash prizes has mushroomed throughout Virginia in recent months. Establishments have opened in large cities, including Richmond, the capital, and smaller ones like Hampton Roads and Roanoke.

Local press reports said 17 Internet-based gaming centers were licensed to operate in Virginia Beach in recent months, but not all have opened.

In most cases, sweepstakes videogame operators sell time on the Internet. Customers have the option to play games that simulate slots, but any cash prizes are awarded on the basis of separate -- and technically unrelated -- sweepstakes drawings.

Nevertheless, Bryant said he believed these sweepstakes games constitute illegal gambling because customers can win cash for non-skill pay-to-play action. Bryant held to this view in spite of the fact that Virginia Attorney General Ken Cuccinelli released an opinion letter in July stating that he believed the sweepstakes devices are legal.

Cuccinelli's opinion was issued in reply to a request by state Delegate Bill Janis (Glen Allen). In his letter, Cuccinelli stated:

"You ask whether prizes offered by a retail provider of Internet and computer services are permissible or whether they constitute illegal gambling under the laws of Virginia when entries to win prizes are available to persons who purchase computer time as well as to those who do not … It is my opinion that the element of consideration is missing, and therefore no illegal gambling occurs, when the opportunity to win a prize is offered both with a purchase and without the requirement of a purchase."

However, Cuccinelli's letter also contained the proviso that local authorities ultimately must make the call as to legality of specific sweepstakes devices in their own jurisdictions. The Virginia Beach city attorney told local TV news reporters that his office consulted gambling experts before deciding to bust the sweepstakes game parlors.

According to the Virginia Pilot, copies of Cuccinelli's opinion letter were taped to every machine in four units of D&H Business Centers in Virginia Beach. But the letters did not prevent local police from raiding the stores and seizing the machines, said owner Daniel Storie.